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The state tourism revenue increases
IN THE MIDST of economic doldrums when domestic tourism rose nationally just 1.7 percent, visits to Virginia jumped 8.1 percent. That's what Gov. Bob McDonnell calls "an instant revenue generator"--and a clue to what's a good bet for investment by local governments.
The report, generated by the U.S. Travel Association and released by the Virginia Tourism Corporation (charged with marketing the state domestically and internationally) shows that domestic travelers (overnight visitors or day-trippers who traveled more than 50 miles) spent $20.4 billion in the state in 2011, supporting 207,000 jobs and generating $1.32 billion in state and local tax revenue. Their top destinations were Arlington, Fairfax, and Loudoun counties; Virginia Beach; and Henrico County.
What about "America's Most Historic City"? Fredericksburg travel expenditures (i.e., what tourists spend on gas, food, lodging, etc.) were up 8.1 percent last year over 2010; state tax revenue from tourism in the city rose 3.2 percent while city tax revenue was up 3.1 percent. The surrounding counties saw increases as well: Spotsylvania tourism expenditures rose 6.2 percent while Stafford visitors spent 5.4 percent more.
If tourism-related spending was up 8.1 percent, why was the increase in state and local tax revenue proportionately so much less? Part of the total of what tourists spent was due to the jump in gas prices: In December 2010, gasoline in Virginia averaged $2.80 per gallon. By the end of 2011, it had risen to $3.41 per gallon. But gas is taxed differently from, say, a hotel room, and the General Assembly's resistance to raising the gas tax suppresses that factor when it comes to total tourism tax revenue.
Nevertheless, there's a lot in this report from which localities can learn. To put it simply, tourism pays off in revenue and jobs. In fact, travel is the fifth largest non-agricultural employment sector of the state. So finding ways to capture the imagination of people in other parts of the United States and turning them into tourists will help the local economy.